How Great Leaders Drive Corporate Innovation

In research carried out by McKinsey, more than 70 percent of the senior executives in a survey conducted years ago, said that innovation will be at least one of the top three drivers of growth for their companies in the next three to five years.


It’s unarguably true that Innovation has become the most important way for companies to accelerate the pace of change in today’s global business environment.


Organizations that share in this idea have taken a step further in expanding their categories of innovation beyond products and services to include distribution, value chain, business model, business processes, etc.


For many organizations, the matra has become “innovate or stagnate.”


Yet, in McKinsey’s research, most senior leaders are not confident in their ability to stimulate innovation and execute on it. About 65 percent of the senior executives surveyed were only “somewhat,” “a little,” or “not at all” confident.


Part of the problem could be that they have put forth structures and processes that sabotage their aspirations and efforts.


To be clear, everything rises and falls on leadership. Another survey of 600 global business executives, managers, and professionals by McKinsey shows: leadership is the best predictor of innovation performance.


In the survey, those who described their own organization as innovative rated its leadership capabilities as “strong” or “very strong.”

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On the contrary, those who believed that the ability of their own organization to innovate was below average rated its leadership capabilities as significantly lower and, in some cases, as poor.


The question is how can leaders drive innovation in their organizations and accelerate growth?


Here are a few ideas that great leaders have explored and implemented with outstanding results.


Focus On People Not Profit

Give attention to people – employees, customers, suppliers, alliances, etc.


Innovation is a collaborative effort. Leaders who understand this give attention to all the people they and their organizations interact with in order to innovatively create value.


Your customers, for example, are part of your innovation process. A certain gentleman created and sold sketches for a studio that creates designs for a stylist and textile manufacturer.


He failed about 150 times for three years to get them to buy his sketches. Then he decided to involve them in the creation process.


He went over to the studio with dozens of unfinished sketches. Then he asked the lead stylist, “I want you to do me a favor if you will. Here are some uncompleted sketches. Won’t you tell me how we can finish them up in such a way that you can use them?”

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The stylist made his suggestions. The gentleman quickly completed the sketches and the stylist bought all of them.


Dell Computer applied this method also when they asked and received specifications from their customers and built them even if they never existed.


Create An Environment Where People Flourish

Such environment should be:


Fear Free: “No passion so effectively robs the mind of all its powers of acting and reasoning as fear” – Edmund Burke.


Innovation is not possible if people don’t feel safe. Innovation will always involve trying out new things.


Organizations that invest in research and development know this – not every investment in R&D will yield commensurate fruit; some will yield nothing, while some will yield high fruits, yet others might be seen as a mistake now but turn out to be an Innovation later.


For example, the weak cohesive substance produced by a scientist at 3m corporation was initially a mistake. But it turned out to be an Innovation when one of the scientists used it to stick his music note that was been blown away while he played his piano – that’s how post-it notepad was born.


But no meaningful Innovation will take place except the leader takes the responsibility to create a fear-free environment where people can explore without the consciousness that someone is waiting behind to reprimand them.

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Where People Enjoy Responsible Freedom: “It doesn’t make sense to hire smart people and tell them what to do; we hire smart people so they can tell us what to do.” – Steve Jobs


If you truly want to drive innovation in your organization then you must give up trying to control everything that happens.


I remember one organization where employees were supposed to appear in a uniform for an event they were hosting, the director decided even down to the color.


No wonder she never enjoyed a harmonious environment necessary for teamwork and innovation.


The truth is if you have a talent-role fit, which is also a prerequisite for driving innovation, you’ll be standing in people’s way if you try to control their time, techniques, team, and task.


Organizations like 3m corporation have set up a system that 20% of a scientist’s time is invested in any activity he or she likes. No wonder they have over 50,000 patents.


Google also does the same. In fact, Gmail is one of the results of that freedom.


Turns out that accountability is a result of autonomous work.

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